CULTIVATE, the national collaborative credit union finance lending platform for farmers, had a 37% rise in loan applications in the period January to June compared to last year.
During this period the number of credit union locations increased to more than 150 across the country.
The average loan application from farmers for the first half of 2022 was for €28,083 and was used for a number of key on-farm activities including stocking and working capital (33%). The next most popular loan purposes were for farm buildings (17%), purchase of farm equipment (16%) and tractor purchases (14%). These loan purposes underline the importance farmers are placing on investing in their farms while also highlighting the ongoing pressures facing farmers due to rising input costs.
Beef farmers continue to account for the majority of farmers applying for a Cultivate loan, with 71% of loan applications for the first six months of 2022 coming from beef farmers. Dairy farmers accounted for 17%, while sheep farmers accounted for 9% of applications.
The first six months of 2022 was the first time that March was the most popular month for applications, representing almost 24% of total loan applications in the period. February continues to be the busiest month for applications from dairy farmers, accounting for 33% of total dairy applications; March was the busiest month for applications from beef farmers, representing 25% of total beef related applications.
Not surprisingly, dairy farmers continue to carry a higher level of debt on their farm than their beef counterparts. The most common debt value for beef farmers was €70,596 while dairy farmers are managing over double that, at €147,398.
The average loan application from a dairy farmer was just over €35,000, compared to €27,581 for a beef farmer. Off-farm income continues to be a major differing factor for beef and dairy farmer: 92% of beef farmer applicants had some sort of off-farm income, compared to 62% of dairy farmers.
Niamh O’Driscoll, senior loans officer with Bantry Credit Union, said: ‘Cultivate is going from strength to strength. Cultivate now has the support of the two credit union representative bodies in Ireland (the ILCU and CUDA) as the national farm finance brand for Ireland’s credit unions. The number of credit unions offering Cultivate continues to grow. Access and Bantry Credit Unions are just two of ten credit unions in county Cork that offer Cultivate loans.’
Averyl Condell, business development officer with Access Credit Union said: ‘Farmers availing of a Cultivate loan appreciate being able to deal with someone who understands the needs of their farm and who is also a member of the local community. They appreciate the fact that every decision in a credit union is made locally by people they can talk to.’